A patent is an exclusive right or rights granted by a government to an inventor for a limited time period in exchange for the public disclosure of an invention. Examples of classes of patents include business method patents, software patents, biological patents and chemical patents. In general, the granting of a patent is dependent on passing tests of patentability: patentable subject matter, novelty (i.e. new), inventive step or non-obviousness and industrial applicability (or utility).Business Method Patents: These are species of patents regarding a claim on, and public disclosure of, a new method(s) of operating any aspect of an economic enterprise. Examples include e-commerce, banking, insurance, tax compliance and other business methods.Software Patents: There is no generally accepted or universally accepted definition of a software patent. The Foundation for a Free Information Infrastructure defines software patent as "a patent on any performance of a computer realized by means of a computer program.”
Since the system was established in 1790, patents in the United States have been granted based on methods of doing business. The first financial patent was granted in 1799 to Jacob Perkins for an invention for “detecting counterfeit notes.” For many years, the U.S. Patent and Trademark Office (USPTO) maintained that “methods of doing business” were not patentable. However, in the 1980s and 1990s many applications emerged on the Internet or computer enabled methods of commerce, and the USPTO decided they would no longer determine whether a particular computer-implemented invention is a technological or business invention. Rather, they would determine if the invention was patentable based on the same statutory requirement of any other invention. By 2001, the USPTO determined that to be patentable, a business method invention only had to be carried out on a computer. However, this was overturned in 2005. On October 30, 2008 a Federal Circuit court appeared to declare “patent-ineligible” many business-method patents of the last decade, but a majority opinion in the “in re Bilski” case refused to hold business methods patent-ineligible on any grounds.Software Patents: Important issues of the patentability of software inventions include: - Where the demarcation line is between patentable and non-patentable - Whether the “innovative step” and “non-obviousness” requirements are applied too loosely - Whether innovation is encouraged or discouraged by the patent process One of the first software patents was granted after a British patent application was filed in 1962 entitled, “A Computer Arranged for the Automatic Solution of Linear Programming Problems.” It was granted in 1966. The proliferation of e-commerce and the Internet has led to many U.S. patents being granted for business methods implemented with software. And again, USPTO and U.S. courts seem to grant patents or rule on patentability on a case-by-case basis. The issue of patentability of software inventions and innovations is complicated and made more so by different patent offices and government rulings in many countries around the world.